Agglomeration and Innovation
Forthcoming in Handbook of Regional and Urban Economics, Vols. 5A and 5B
62 Pages Posted: 12 Sep 2014
Date Written: August 2014
This paper reviews academic research on the connections between agglomeration and innovation. The authors first describe the conceptual distinctions between invention and innovation. They then discuss how these factors are frequently measured in the data and note some resulting empirical regularities. Innovative activity tends to be more concentrated than industrial activity, and the authors discuss important findings from the literature about why this is so. The authors highlight the traits of cities (e.g., size, industrial diversity) that theoretical and empirical work link to innovation, and they discuss factors that help sustain these features (e.g., the localization of entrepreneurial finance).
Keywords: Agglomeration, Clusters, Innovation, Invention, Entrepreneurship
JEL Classification: J2, J6, L1, L2, L6, O3, R1, R3
Suggested Citation: Suggested Citation